Sri Lanka reports strong PC sales

Strong marketing efforts and falling PC prices have contributed to strong PC sales in Sri Lanka during the first quarter, according to IDC.

In a statement Wednesday, the analyst company said desktop and notebook shipments reached 52,230 units, registering an annual growth rate of 17.5 percent.

Linus Lai, research and consulting director for IDC's emerging Asia region, noted: "Both the consumer and commercial segments have been key drivers for the market's activity. Heightened vendor marketing efforts have provided consumers with more knowledge, while the continuing PC price drop has granted buyers more purchasing power."

According to IDC, desktop PCs continue to be the primary form factor, accounting for almost 87.5 percent of total PC shipments in Sri Lanka, though notebooks have also been performing relatively well.

IDC predicts that desktop PCs will post a compound annual growth rate (CAGR) of 11.7 percent from 2006 to 2011, while notebooks are expected to register a CAGR of 22.7 percent.

However, the size of the Sri Lankan notebook market remains relatively small due to the high prices in the consumer space, and enterprise adoption of notebooks is still largely limited to higher management executives.

Still, IDC noted a number of factors that will drive notebook adoption in Sri Lanka. For instance, price competition among vendors will lead to declining prices, and this will make notebooks more affordable.

Stronger demand for notebook computers is also expected, thanks to increasing awareness of mobile computing among Sri Lankans. Last year's heightened vendor marketing programs will help bolster demand for notebook PCs, said IDC.

Industry spending
According to IDC, IT projects were mainly carried out by the financial services, manufacturing and telecommunications industries.

The national government also contributed to IT hardware spending through computerization projects involving the Information and Communication Technology Agency, Ministry of Education and government-owned agencies.

However, the analyst house said, Sri Lanka will have to pursue an economic policy that will reflect a positive attitude toward foreign investments while maintaining peace and order internally.

Although Sri Lanka has one of the highest GDP per capita in South Asia and its IT industry has grown quickly, PC penetration is still low. According to the latest 2004 study by Sri Lanka's Department of Census and Statistics, household PC and Internet penetration rates stood at 3.8 percent and 3 percent, respectively.